USDA forecasts net farm income will decline $25.9 billion (15.9%) from last year to $136.9 billion. After adjusting for inflation, net farm income is expected to decrease $30.5 billion (18.2%) in 2023. Net farm income in 2023 still would be 26.6% above its 20-year average (2002–2021) of $108.1 billion in inflation-adjusted dollars.
USDA forecasts net cash farm income, which incorporates cash receipts from farming as well as cash farm-related income (including government payments) minus cash expenses, will decline $39.4 billion (20.7%) to $150.6 billion in 2023. When adjusted for inflation, 2023 net cash farm income is expected to decrease by $44.7 billion (22.9%) from a record $195.3 billion in 2022. Net cash farm income still would be 15.4% above the 20-year average of $130.5 billion.
USDA projects direct government payments will fall $5.4 billion (34.4%) from last year to $10.2 billion. This decrease is expected largely because of lower supplemental and ad hoc disaster assistance in 2023 relative to 2022.
Farm sector equity is expected to increase 5.0% to $3.5 trillion in nominal terms. Farm sector assets are forecast to increase 5.2% to $4.0 trillion following expected increases in the value of farm real estate assets. Farm sector debt is forecast to increase 6.2% to $535.1 billion. Debt-to-asset levels for the sector are expected to increase from 13.09% last year to 13.22%. After increasing in 2021 and 2022, USDA forecasts working capital will fall 11.2%.